Health Care Collapse Not a Viable Option for Congressional Republicans

Rallies Held Across The Country To Protect Obama's Affordable Health Care Act
Protestors demonstrate during a health care rally at Thomas Paine Plaza on February 25, 2017 in Philadelphia, Pennsylvania.Mark Makela / Getty Images

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By Leigh Ann Caldwell

WASHINGTON — Since Republicans failed in their effort to repeal the Affordable Care Act last week, President Donald Trump has returned to a familiar refrain, saying that the party should just let Obamacare fail. But GOP lawmakers on Capitol Hill say that is not a viable — or politically prudent — option, because the party has plenty to lose if the law collapses.

Trump says that Democrats will own Obamacare’s problems if the GOP does nothing. But most Republicans in Congress fear that they will be blamed if their constituents lose access to health care or if their costs skyrocket.

“I said from the beginning, ‘let Obamacare implode, and then do it,’” Trump said about reforming the system on Friday. “I turned out to be right. Let Obamacare implode."

There are at least two ways that Trump can allow the Affordable Care Act to implode. He could cut off subsidies for low income Americans to help them pay for deductibles and copayments, something his administration has threatened for several months. Trump also advocates doing nothing to help the individual market in some areas where insurers have stopped providing coverage. The uncertainty surrounding that has played a part in insurance markets fleeing some markets.

Related: What's Going to Happen to Obamacare?

But many Republicans reject both of those scenarios, potentially pitting Trump against his own party.

Despite failing to pass legislation to reform the health care system so far, no GOP senator has said that they support doing nothing now.

“I don’t think we ought to let anything collapse. This isn’t about winning and losing,” said Sen. John Kennedy, R-La.

But it is about the impact on their constituents.

The areas where the individual markets are down to one, two or even zero insurance options are most often in rural parts of the country and in the South or Midwest. Those states and districts are places that voted for Trump or are represented by a Republican in Congress, making it politically risky for the GOP to just let Obamacare fail.

Republicans are already bracing for electoral repercussions should they not fulfill their campaign promise of repealing Obamacare, but now they are also aware of potential consequences for not providing better, affordable options for their voters.

For instance, all of South Carolina, Alabama and Wyoming have just one insurance option and all three are almost exclusively represented by Republicans in Congress.

And many other areas with limited insurance options are swing districts or states currently held by Republicans — including Nevada and Arizona — making them potential targets for Democrats in next year's elections. Others are in swing areas represented by Democrats — like Missouri and West Virginia — making them potentially less vulnerable to GOP challengers.

Insurer participation on the Obamacare MarketplacesCarrie Dann / NBC News
2016 Election Results, by CountyCarrie Dunn / NBC News

Sen. Mike Rounds, R-S.D., whose state has just two options for insurance in the individual market, said that it’s not about politics but making sure people don’t suffer.

“We have to do something to reduce premiums, we have to stabilize the market or real people are going to get hurt,” Rounds said. “I don’t think the American people want us to simply walk away and let this thing explode, which is what it’s doing.”

But Trump vacillates between urging Republicans to keep working and making statements that make the insurance system stable and predictable.

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And Republicans are starting to blame Trump for some of the health systems’ problems.

“I’m troubled by the uncertainty that has been created by the administration,” said Sen. Susan Collins, R-Maine, on NBC’s “Meet the Press” on Sunday. “The uncertainly of whether that subsidy is going to continue from month to month is clearly contributing to the destabilization of the insurance market.”

Republicans are open to do something they wouldn’t normally do to ensure that the system doesn’t collapse: prop up Obamacare with federal funding.

Sen. Lamar Alexander, R-Tenn., who represents a state with just one or two insurers in most counties, has said throughout this process that his first priority is to help people who are facing few insurance choices. He plans to hold hearings soon on how to ensure that insurers stay involved in the current system.

“Republicans will need to temporarily support some things we would not normally support over the longer term — and I would hope Democrats would do that as well,” said Alexander, chair of the Senate health committee.

A group of about 40 centrists Republican and Democrat members of the House of Representatives released a framework for fixing the problems with Obamacare Monday. At the top of their list is to fund the so-called cost sharing reduction payments and to create a stability fund to prop up the Obamacare exchange market.

That plan doesn’t seem to have any real momentum yet and any idea that involves throwing money at the problem is likely going to be a last resort in the Republican Congress.

AshLee Strong, a spokesperson for Speaker Paul Ryan, responded saying, “while the speaker appreciates members coming together to promote ideas, he remains focused on repealing and replacing Obamacare.”

While Trump is urging Obamacare’s implosion, he is also continuing to push Republicans to hand him a victory. He met with Sens. Lindsey Graham R-S.C., Bill Cassidy, R-La., and Dean Heller, R-Nev., on Friday at the White House to discuss their plan to give federal funds to the states for states to implement components of their own health care plan. Sen. Cassidy had another meeting at the White House on Monday to continue discussions.

But there’s not a lot of time. The deadline for insurers to set their plans and pricing for 2018 is at the end of September. And the administration is supposed to decide if it will pay the subsidies for low-income Americans by the end of August: two deadlines with major repercussions for the insurance markets.

But coming to an agreement is going to be difficult will likely need Democrats.

"There's just too much animosity and we're too divided on healthcare," Sen. Orrin Hatch, R-Utah, told Reuters.

Garrett Haake, Alex Moe and Carrie Dann contributed.